Filling in the Blanks: Lending Webinar Q&A

There were some unasked, and unanswered, questions from the webinar held on Aug. 1. We wanted to provide those answers here. The webinar was titled “Loans: The Next Frontier” and featured Midwest credit union executives Minh McKenzie and Dave Larson, as well as Sarah Snell-Cooke, the Credit Union Times editor-in-chief who served as moderator.

The focus at the Aug. 1 lending session was on strategies, technologies and culture changes that have led to success in lending at their credit unions.

Here’s some of what they had to say later.

First, from Minh McKenzie, vice president of sales and service at Community First Credit Union in Appleton, Wis.

What type of training did you use?

CML – Creating Member Loyalty through CUNA

Did you design your own employee survey or did you use an outside provider? How was this structured?

No, we partnered with IIT Center for Research & Service at (312) 567.6472 or www.center.iit.edu.

How do you implement the surveys to your members? Do you direct mail, in office, online, or outsource?

We use Raddon to implement our member surveys. They use direct mail and phone surveys.

How are you measuring job satisfaction at the credit union?

From our employee survey and observations. From how we treat one another and our members.

In addition to training to facilitate the culture change, what tools or technology are being used moving off the transactional platform?

Training, coaching and spending time with staff in the branches. We expect our branch managers and head tellers to coach our team in the desired service skills and behaviors.

What was the turnover rate while you were changing the culture?

It was extremely low for us at CFCU. The key is to communicate the reasons why we’re transforming to the Sales and Service Culture.

Since you are from Wells Fargo, what do you see as the difference between your CU after training and the culture you came from at Wells Fargo?

Our employees at CFCU have the desire and commitment to help our members versus a high sales focus culture at Wells Fargo.

Would you say that focusing on home loans, where you get a lot closer to your member, is one of the secrets to your success?

Yes, it’s our ability to have a conversation with our members to uncover the home equity and/or mortgage loan opportunities.

Has Community First cut staff over the past five years?

We did not have any forced layoffs the last five years and have grown our staff from 360 employees to 400 during that time.

And here are responses from Dave Larson, senior vice president at Affinity Plus FCU in St. Paul, Minn.

How do you stay in touch with members who never come into a physical branch?

We’ve created several channels in which members can reach us conveniently when they are unable to visit us in a branch. And because of these channels, our membership spans across the country and internationally. Our most popular source of contact for members is over the phone, and just over the past year, we’ve experienced a 15% increase in volume. We offer instant chat that allows members immediate responses to all account-related questions. On average, our members send us over 3,300 chats a month and this continues to increase. Additionally, members contact us through the email channel; we reach out to members with organizational announcements and updates through email; and we offer online loan and account opening on our website.

Is the growth in members a net change? If not, what is the number of members leaving your credit union each month?

On average, we’ve welcomed about 2,000 members each month consistently over the past several months. At this point we do not have a number for members who leave each month.

You mentioned quite a large mortgage portfolio – both loans generated and loans serviced. Do you sell your mortgages on the secondary market, and what percentage is your mortgage portfolio of total loans?

We do sell loans to the secondary market. I believe our mortgage portfolio represents approximately 30% of our total portfolio.

Were incentives a significant part of your culture evolution?

Several years ago employees were incented to “sell” products to members. However, this did not align with our strategy of doing the right thing for members and focusing on the person, not the organization (or profit). Employees offer products and services to members based on the individual needs and wants of the member. Now, high-performing employees – those that believe in and support our vision – are given an annual bonus.

What categories are you seeing your loan growth from?

Auto, credit card, first mortgages.

If a member can talk to any member adviser, is all staff registered with NMLS so they can talk real estate?

Yes

How have you achieved 13% member growth?

Our members are avid referrers. Approximately 80% of our new members are referred by their friends and family. Additionally, we have an active and physical presence on four college and university campus locations, which is a factor in member growth. Our “Ditch Your Bank” campaign, which targets people who are tired of their banks, has also contributed to this growth.

Is your staff represented by a union? If they are represented by a union, how were the changes implemented?

We are not union.

What are your total assets if your lending is about $3.4 billion?

We have $1.5 billion in assets and service about $2.0 billion in mortgages.

Where is your credit union located? What is the mix of your membership, blue collar or white collar?

Our corporate office is located in St. Paul, with branch locations across Minnesota. Our membership spans across all demographics and backgrounds. We are proud to state that the common thread in the mix of our membership is that they are ordinary people who do extraordinary things.